US-Iran Tensions Influence Markets

Market sentiment is being shaped by developments surrounding a potential US-Iran peace deal, with reports that Iran is reviewing a US proposal to end the war. This optimism has contributed to a decline in the US Dollar and a fall in WTI crude oil prices, while concurrently providing support to silver prices. However, uncertainty remains, as the US President also issued a warning of a strong military response if a deal is not reached.

Central Banks Signal Hawkish Stances

Several central banks are signaling tighter monetary policy, with Bank of Japan minutes revealing some members saw a need to raise rates if energy shocks from the Iran war persist. Japanese finance officials continue to closely monitor currency markets and have not ruled out intervention to support the yen. Elsewhere, the Reserve Bank of New Zealand expects slower but continued growth, and the People's Bank of China set a stronger-than-expected reference rate for the yuan.

Global Trade and Economic Data

Australia reported a surprise trade deficit of A$1.84 billion for March, a sharp reversal from the prior month's surplus, though the Australian dollar later recovered its losses. In other trade developments, an EU negotiator noted there is "still some way to go" on a trade deal with the US, while reports suggested the US and China are considering talks on AI and that China has asked banks to halt loans to US-sanctioned refiners.